NEW YORK--(BUSINESS WIRE)--
Synergy Pharmaceuticals Inc. (NASDAQ:SGYP), a biopharmaceutical company
focused on the development and commercialization of novel
gastrointestinal (GI) therapies, today reported its financial results
and business update for the three months ended June 30, 2017. Synergy
will host a conference call and webcast at 4:30 p.m. Eastern Time on
Thursday, September 7, 2017 to discuss its corporate and financial
strategy, and provide a general business update. Further details about
this conference call can be found below.

“The first half of 2017 was a truly transformative period for Synergy,
as we transitioned into a commercial organization and launched our first
product, TRULANCE, in the U.S. for the treatment of adults with chronic
idiopathic constipation (CIC),” said Gary S. Jacob, Ph.D., Chairman and
CEO of Synergy Pharmaceuticals Inc. “We are pleased with the execution
of our commercial strategy, and the strong initial demand for TRULANCE,
reinforcing the need for new treatment options for patients suffering
from CIC. And we are making significant progress in ensuring broad
access to TRULANCE, highlighted by a number of favorable early decisions
from key national payers.”

“During the second quarter, we also made significant progress towards
broadening the TRULANCE label with the FDA acceptance of our sNDA for
the treatment of adults with IBS-C,” continued Dr. Jacob. “These
achievements put Synergy on excellent footing as we look to drive
further long-term growth and value for the TRULANCE brand.”

Gary Gemignani, Synergy’s EVP and Chief Financial Officer added, “We
believe Synergy is well-positioned to efficiently capitalize on the
substantial opportunity we have in front of us with our core, high value
asset, TRULANCE. We are currently evaluating financing options that will
provide flexibility and allow us to continue to execute on our business
objectives, which we are confident will ultimately maximize shareholder
value. We are pleased with our progress on this front and look forward
to providing further updates in the near-term.”

Second Quarter 2017 and Recent Highlights

TRULANCE (plecanatide) Commercial Launch Update

Driving Awareness of TRULANCE and Stimulating Trial and Adoption

Since our launch of TRULANCE on March 20, 2017, our commercial team
continues to introduce TRULANCE to more than 27,000
gastroenterologists, primary care physicians, nurse practitioners and
physician assistants that represent approximately 70% of the branded
prescription business. As of June 30, 2017, we had reached 66% of our
targeted prescriber base and over 90% of the high volume prescribers
(deciles 8-10). According to QuintilesIMS data as of June 30, 2017:

More than 12,600 TRULANCE prescriptions have been filled and total
monthly prescription volume has increased on average more than
182% month-over-month during that period.

More than 32% of all high prescribers had written a TRULANCE
prescription during that period with an average increase for all
prescribers of approximately 140% month-over-month.

As of June 30, 2017, more than half of new TRULANCE prescriptions
filled since launch were coming from new patients not previously
on a branded prescription treatment and 45% were patients that
converted from other branded prescription treatments.

Ensuring Market Access

As of June 30, 2017, over 61% of adult CIC patients with commercial
insurance will have unrestricted access to TRULANCE for 2017 based on
the top 20 pharmacy benefit managers (PBMs) and payers. Additionally,
approximately 95% of people with commercial insurance had access to
TRULANCE for a co-pay of $25 or less through the TRULANCE
Savings-to-Go-Program.

We have secured a 2018 managed care contract with CVS Caremark, which
manages approximately 50 million commercial lives in the U.S., that
will place TRULANCE on formulary without restriction (non-preferred)
for its Commercial Template Clients or Employer Groups, representing
approximately 24 million lives. We are in contract discussions with
CVS Caremark for the remaining commercial lives.

TRULANCE is currently available through Express Scripts (ESI), which
manages approximately 80 million total lives in the U.S., and this
commercial formulary status will continue for the remainder of 2017.
ESI recently released its 2018 National Preferred Formulary List and
introduced 64 new drug exclusions, including TRULANCE. This change
only affects access to the ESI National Formulary for non-custom
clients, representing approximately 22 million lives, effective
January 1, 2018. TRULANCE will remain available to ESI lives covered
under the National Preferred Formulary via the “Non-Formulary
Exception Request” prior authorization process, for which we currently
have a support program in place to ensure patient access. ESI also
manages a larger book of business with its Custom Clients,
representing approximately 49 million lives. We are still in active
discussions with ESI to determine 2018 formulary status for individual
plans under their Custom Clients book of business.

We are in active contract negotiations with other PBMs and payers for
2018 coverage to ensure our goal of broad access to TRULANCE.

Med D and Medicaid discussions are ongoing and we expect several major
accounts to include TRULANCE on formulary in 2018.

Sales Force Update

As planned and with the continued progress of the launch, we have
initiated the process to transition our Publicis Touchpoint contract
sales representatives over to Synergy in preparation of our
anticipated approval of TRULANCE in the IBS-C indication this coming
January.

TRULANCE IBS-C Development Update

The FDA has accepted for review our sNDA for TRULANCE for the
treatment of adults with IBS-C. The Prescription Drug User Fee Act
(PDUFA) date is January 24, 2018.

Financial Results

Revenues

Net sales were $2.3 million in the second quarter of 2017, pursuant to
the product launch on March 20, 2017. The Company also recorded
approximately $1.5 million in net deferred revenues on its balance
sheet, which it expects to recognize in future periods. The Company
currently recognizes revenue based on patient demand (prescription
sales).

Expenses

Research and development expenses (“R&D”) were approximately $22.3
million for the second quarter of 2017 compared to approximately $26.6
million for the second quarter of 2016. This decrease was primarily
due to the cost of validation batches as well as pre-commercial
inventory build being classified as R&D in 2016.

Selling, general and administrative (“SG&A”) expenses were
approximately $50.7 million for the second quarter of 2017 compared to
approximately $10.2 million for the second quarter of 2016. These
increased expenses primarily reflect the cost of marketing and
promotional activities to support the product launch of TRULANCE on
March 20, 2017. These costs include an approximately $23.1 million
increase in marketing and sales expenses, an increase of $4.7 million
in employee compensation and benefits costs, and an increase of $11.5
million in stock compensation expense ($9.3 million related to the
modification of Change of Control and terminated employee stock
options). There are no remaining Change of Control options outstanding
as of June 30, 2017.

Cost of goods sold (COGs) were approximately $2.9 million for the
second quarter of 2017. COGs for the quarter are primarily related to
technical operations overhead costs.

Net interest expense was approximately $0.3 million in the second
quarter of 2017, related to the $200 million convertible debt
financing executed in November 2014. As of June 30, 2017, the Company
had approximately $18.6 million in total debt outstanding compared to
approximately $79.2 million a year ago.

Net Loss

Synergy reported a net loss of approximately $73.9 million for the
three months ended June 30, 2017, compared to a net loss of
approximately $38.6 million for the three months ended June 30, 2016.
This increase was a result of the operating items discussed above.

Cash Position

Net cash used in operating activities were approximately $57.3 million
in the second quarter of 2017 compared to approximately $63.5 million
in the first quarter of 2017.

As of June 30, 2017, we had approximately $82 million cash and cash
equivalents compared to approximately $82.4 million cash and cash
equivalents as of December 31, 2016.

Conference Call on Thursday, September 7, 2017:

Synergy will host a conference call at 4:30 p.m. Eastern Time on
Thursday, September 7, 2017 to discuss its corporate and financial
strategy, and provide a general business update. The dial-in number to
access the call is (877) 407-3987 (U.S. and Canada) or (412) 902-0039
(International). To access the webcast, please visit the Investors
section of Synergy's website at www.synergypharma.com.

A taped replay of the conference call will also be available beginning
approximately 2 hours after the call's conclusion, and will remain
available through September 21, 2017. The replay may be accessed by
dialing (877) 660-6853 (U.S. and Canada) or (201) 612-7415
(International) and entering conference ID number 13668774. A replay of
the webcast will also be available on the Investors section of Synergy's
website at www.synergypharma.com.

About Synergy Pharmaceuticals Inc.

Synergy is a biopharmaceutical company focused on the development and
commercialization of novel GI therapies. The company has pioneered
discovery, research and development efforts on analogs of uroguanylin, a
naturally occurring and endogenous human GI peptide, for the treatment
of GI diseases and disorders. Synergy’s proprietary GI platform includes
one commercial product TRULANCE and a second lead product candidate,
dolcanatide. For more information, please visit www.synergypharma.com.

About TRULANCE™

TRULANCE™ (plecanatide) is a once-daily tablet approved for
adults with CIC and is being evaluated for IBS-C. With the exception of
a single amino acid substitution for greater binding affinity, TRULANCE
is structurally identical to uroguanylin, a naturally occurring and
endogenous human GI peptide. Uroguanylin activates GC-C receptors in a
pH-sensitive manner primarily in the small intestine, stimulating fluid
secretion and maintaining stool consistency necessary for regular bowel
function.

TRULANCE Important Safety Information

Indications and Usage

TRULANCE is a guanylate cyclase-C (GC-C) agonist indicated in adults for
the treatment of chronic idiopathic constipation (CIC).

IMPORTANT SAFETY INFORMATION

WARNING: RISK OF SERIOUS DEHYDRATION IN PEDIATRIC PATIENTSTrulance™
is contraindicated in patients less than 6 years of age; in nonclinical
studies in young juvenile mice administration of a single oral dose of
plecanatide caused deaths due to dehydration. Use of Trulance should be
avoided in patients 6 years to less than 18 years of age. The safety and
efficacy of Trulance have not been established in pediatric patients
less than 18 years of age.

Contraindications

Trulance is contraindicated in patients less than 6 years of age due
to the risk of serious dehydration.

Trulance is contraindicated in patients with known or suspected
mechanical gastrointestinal obstruction.

Warnings and Precautions

Risk of Serious Dehydration in Pediatric Patients

Trulance is contraindicated in patients less than 6 years of age. The
safety and effectiveness of Trulance in patients less than 18 years of
age have not been established. In young juvenile mice (human age
equivalent of approximately 1 month to less than 2 years), plecanatide
increased fluid secretion as a consequence of stimulation of guanylate
cyclase-C (GC-C), resulting in mortality in some mice within the first
24 hours, apparently due to dehydration. Due to increased intestinal
expression of GC-C, patients less than 6 years of age may be more
likely than older patients to develop severe diarrhea and its
potentially serious consequences.

Use of Trulance should be avoided in patients 6 years to less than 18
years of age. Although there were no deaths in older juvenile mice,
given the deaths in young mice and the lack of clinical safety and
efficacy data in pediatric patients, use of Trulance should be avoided
in patients 6 years to less than 18 years of age.

Diarrhea

Diarrhea was the most common adverse reaction in the two
placebo-controlled clinical trials. Severe diarrhea was reported in
0.6% of patients.

If severe diarrhea occurs, the health care provider should suspend
dosing and rehydrate the patient.

Adverse Reactions

In the two combined CIC clinical trials, the most common adverse
reaction in Trulance-treated patients (incidence ≥2% and greater than
in the placebo group) was diarrhea (5% vs 1% placebo).

This press release and any statements made for and during any
presentation or meeting contain forward-looking statements related to
Synergy Pharmaceuticals Inc. under the safe harbor provisions of Section
21E of the Private Securities Litigation Reform Act of 1995 and are
subject to risks and uncertainties that could cause actual results to
differ materially from those projected. These statements may be
identified by the use of forward-looking words such as "anticipate,"
"planned," "believe," "forecast," "estimated," "expected," and "intend,"
among others. There are a number of factors that could cause actual
events to differ materially from those indicated by such forward-looking
statements. These factors include, but are not limited to, the
development, launch, introduction and commercial potential of TRULANCE;
growth and opportunity, including peak sales and the potential demand
for TRULANCE, as well as its potential impact on applicable markets;
market size; substantial competition; our ability to continue as a going
concern; our need for additional financing; uncertainties of patent
protection and litigation; uncertainties of government or third party
payer reimbursement; dependence upon third parties; our financial
performance and results, including the risk that we are unable to manage
our operating expenses or cash use for operations, or are unable to
commercialize our products, within the guided ranges or otherwise as
expected; and risks related to failure to obtain FDA clearances or
approvals and noncompliance with FDA regulations. As with any
pharmaceutical under development, there are significant risks in the
development, regulatory approval and commercialization of new products.
There are no guarantees that future clinical trials discussed in this
press release will be completed or successful or that any product will
receive regulatory approval for any indication or prove to be
commercially successful. Investors should read the risk factors set
forth in Synergy's most recent periodic reports filed with the
Securities and Exchange Commission, including Synergy’s Form 10-K for
the year ended December 31, 2016. While the list of factors presented
here is considered representative, no such list should be considered to
be a complete statement of all potential risks and uncertainties.
Unlisted factors may present significant additional obstacles to the
realization of forward-looking statements. Forward-looking statements
included herein are made as of the date hereof, and Synergy does not
undertake any obligation to update publicly such statements to reflect
subsequent events or circumstances except as required by law.